Alcoa Reports Profit Up 58%, Exceeding Analysts’ Forecast

Alcoa kicked off the earnings season on Monday by reporting a larger first-quarter profit than analysts had expected, helped by strong demand for aluminum used to make airplanes and automobiles.

The company still predicts that demand for aluminum will grow 7 percent in 2013, with gains cutting across many industries.

Alcoa is the first company in the Dow Jones industrial average to report first-quarter results. Because its products wind up in so many things, including cars, buildings and soda cans, investors study Alcoa’s results for hints about earnings at companies in other industries.

Alcoa reported that its net income rose 58 percent in the first quarter, to $149 million, or 13 cents a share, compared with $94 million, or 9 cents a share, a year ago.

Excluding one-time items, the company said it earned 11 cents a share, beating analysts’ forecast of 8 cents a share, according to FactSet.

Revenue fell 3 percent, to $5.83 billion, from $6.01 billion a year ago, and was below the $5.91 billion that analysts had predicted. Alcoa blamed lower aluminum prices and curtailed production in its European primary metals business.

Over the last decade, Alcoa has shifted more of its business to the production of parts for industry and away from mining and refining. It is benefiting as airplanes and autos get lighter to improve fuel efficiency by using more aluminum parts.

Airlines have been ordering new planes to reduce spending on fuel, the largest cost for many of them. That trend should continue for several years, making aerospace a growing aluminum market, Klaus Kleinfeld, Alcoa’s chairman and chief executive, said in a conference call with analysts.

Auto sales are booming, too, as customers who delayed buying in the recession trade in their old vehicles. In March, sales hit 1.45 million vehicles, the highest total since August 2007, according to Autodata.

Alcoa predicts that government fuel standards and customer demand for better mileage will lead carmakers to use more lighter materials like aluminum. Some drivers contend heavy vehicles are safer in a crash, but Mr. Kleinfeld argued that lighter cars could brake to a stop faster, potentially avoiding accidents.

Sales of aluminum for nonresidential construction is finally recovering in North America and will grow much faster in China, Mr. Kleinfeld said.

Alcoa, based in Pittsburgh, released its earnings after the markets closed. In after-hours trading, its shares fell 13 cents, or 1.6 percent, to $8.26 after gaining 15 cents, or 1.8 percent, in the regular trading to close at $8.39.

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